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POLITICO 44

Lawmakers from both parties are attacking a White House proposal that would grant the federal government sweeping powers to wind down financial firms – an authority one Democrat derided as “TARP on steroids.”

With Treasury Secretary Timothy Geithner listening in a House hearing room, bailout-weary lawmakers are spending Thursday morning picking apart a proposal by Rep. Barney Frank (D-Mass.) that seeks to grant this “resolution authority” to the government, similar to the authority the Federal Deposit Insurance Corp. has over U.S. banks that become insolvent.

“Let’s not adopt ‘TARP on steroids,’” Rep. Brad Sherman (D-Calif.) said in a release before the hearing started.

Rep. Luis Gutierrez (D-Ill.) slammed the bill’s proposal that when the government has to front money to cover the costs of winding down a dying firm, other big financial firms will pay the bill via a fee assessed after the fact.

Gutierrez argued that the firms should pay into a fund, “Now, today, not after the fact.”

“They should pay for future insurance policy payouts. The fund should be set up just in case their behavior … raises its ugly head again,” he said.

Rep. Spencer Bachus of Alabama, the ranking Republican on the committee, complained that Frank released the draft text Tuesday afternoon, less than 48 hours before the hearing, giving neither members nor witnesses enough time to digest its contents.

Still, he said he’d read enough not to like what’s being proposed. “The administration has chosen to continue its failed policy of taxpayer bailouts,” he said. “Their proposal places taxpayers first in line to bear the losses when the government invokes its resolution authority.”

Rep. Scott Garrett (R-N.J.) raised concern about how much power the Federal Reserve is given under the new bill.

“In the last several months, it was my impression that there was a developing consensus that the Federal Reserve should be given less power, not more,” he said. “In the name of mitigating systemic risk, the Fed is also given unlimited authority to systematically dismantle a private company. This is a lot more sweeping than imposing tougher capital standards.”

Frank defended the timing of the hearing, observing that the ideas contained in the proposal were first floated in April 2008 by then-Treasury Secretary Henry Paulson and “have been under serious discussion since then,” including in previous drafts of the legislation.

Frank accused critics of rewriting history, reminding them that the bailouts of AIG and other firms occurred because the federal government lacked the power to deal with a situation that traditional bankruptcy proceedings could not address.

“Our whole purpose to day is to change that situation and to prevent it,” Frank said.

He challenged the notion that Congress would somehow opt to use taxpayer money rather than by collecting fees from the financial firms, as the bill would require. “This is a set of proposals that will prevent taxpayer money from being used,” Frank said.

B. Franks is a "big business" cronie who pretends to be for the people. He blatantly created a bill that socks it to the taxpayer and allows certain banks to determine which companies must fail or be forced to merge. It is allowing the olygarchies free reign in a power grab to take over corporate America making themselves too big to fail. That guy needs to go!

Why would any reasonable person believe Barney Frank? Besides putting more power in the hands of the pols makes it so we are more and more beholding to them. That is not what this country is about. We are seriously on the wrong track now.

Barney and friends are once again trying to destroy what has made this country great. The laws of supply and demand. I said it when the first "TARP" BAILOUT was being talked about. Let them go down! Let them go! Most of these companies got in trouble because of union rules on wages and production. Along with "GOVERNMENT" regulation. If they are viable companies, they will come back free of unions and if we want them back we the people will get the "GOVERNMENT OFF THEIR BACKS" at the polls. What has happened instead is we are being "TOLD" we have to pay for the problems created by unions and government. I do not think Barney can add 2+ 2 and get the same answer two times in a row. Sadly he is pretty much the norm for congress men and women. Our commander in chief won't even try with out his teleprompter. There is only one answer to the problem this country faces and that is to remove from office every congressional and senatorial officer currently holding office. No one who has not run a successful company for at least three years should be considered as eligable to hold office. (running a law office does not qualify) Terms should be limited to no more than 2 for any Federal postions that is elected or appointed except for supreme court justices. All federal income tax laws should be repealed and a straight tax not to exceed 7 percent should be set in place. Washington should be held to the amount they get as the amount they can spend. Any government official caught committing a crime while in office shall be imprisoned for no less than 5 years, and citizens caught cheating on their taxes will have their taxes doubled for 10 years. Money collected for S.S. AND MEDICARE SHALL ONLY BE USED FOR THOSE PURPOSES!!!!!!!!!. NO MORE STEALING FUNDS FROM THE COFFERS OF OTHER PROGRAMS TO PAY FOR PORK BARREL PROGRAMS. All those who hold Federal office will retire on S.S. and Medicare like the rest of us. As for Barney and friends, they should give all the difference between S.S. and the retirement program they have to S.S. to assure those who earned it will get S.S. Lets get all the illegals registered, so they can start working on becoming citizens, in the meantime they can start paying their share for taxes etc. Offer amnisty to those who register and deport those who don't. To be fair, those under 30 pay S.S. tax at the same rate as the rest of us, 30-40 3 percent higher, 40-50 will come in at plus 6 percent and those over 50 will have to pay standard plus 9 percent. I think it would be fair for new immigrants to our country to pay at these rates to assure there will be funds of their earnings on hand to help them in their retirement years. LETS GET RID OF BARNEY, THE RED FACED ONE, NOT THE PURPLE ONE

Kleptocracy reigns in a world where the principle fences are fighting crime. Iago Geithner and Roderigo Franks are buying Wall Street''s ideas of painless, changeless reform, and selling them as tough, liberal, regulation. It is no coincidence that this fraud should come from Franks who represents the highest concentrations of financials, along with Dodd & Schumer. Republicans were rolled like bumpkins through their own deregulation, as were most Democrats, but it is time the syndicate of Wall Street shysters, liberal charlatans, and conservative rubes ended.

Frank is right about one thing in the article, let's not forget the history of how we got here and Barney, your hand was certainly stirring the pot when you told congress to leave the banks alone in 2004. Remember, you were dating that guy Hue someone from one of those big banks. Conflict of interest for you? So now you want to try and look like the savior? It's amazing the people of Mass. don't see this man for the corrupt idiot he is. Frank has to go along with Dodd & Rangel!